Identity theft in the United States is already a large and rapidly growing problem. A recent estimate by analyst Jim Hurley of the Aberdeen Group indicate it is growing at 300% annually from a base estimated at $221 billion in financial losses in 2003. Quoting from his analysis:                Profits are high; risks are low. At $9,800 per-incident, identity theft is paying much better than bank robbery, while organized identity theft criminal rings are largely immune from criminal prosecution. (See: The Business of Identity Theft—Not Just a Consumer Problem, Aberdeen Group, May 2003)        
Visa and its member banks have a serious interest in preventing identity theft, and in helping consumers—and defrauded banks—minimize any losses when identity theft occurs. The Role of Bank Cards in Identity Theft One technique that identity thieves use is to establish new, fraudulent credit card accounts using stolen names, Social Security numbers, and other supporting identification. Although this is only one of the many types of crimes identity thieves commit, the relative ease with which this can be accomplished is one of the primary reasons for the growth of identity theft. Quite simply, the ability to open new, fraudulent credit card accounts and to use these cards to purchase goods or obtain cash advances is one of the financial beacons that attracts many identity thieves. Industry initiatives (such as Visa's recent announcement of an identity theft management program in cooperation with Call to Action) focus primarily on what consumers should do to protect their personal information or to help minimize the impact once an identity theft has already occurred. Credit bureaus have programs designed to help consumers manage post-incident identity theft and, through various email-based alert programs, help consumers detect identity theft earlier. New startups have emerged which are also attempting to address the problem of identity theft. For example, San Diego-based IDanalytics, a startup funded last fall by Canaan Ventures and Trinity Ventures, recently announced it was working with thirteen leading credit grantors to apply pattern recognition technology to detect and prevent identity theft at the point of application. Participating companies include Citibank, Dell, Diners Club, Discover Financial Services, First North American National Bank and Sprint (See: “Software Helps Spot Fraud in Credit Applications”, Wall Street Journal, May 14, 2003). IDanalytics claims its system can identify 15% to 40% of fraudulent applications. Importantly, there is no mechanism that guarantees to a consumer that identity theft will not occur.